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    GLOBAL INVESTMENTS LIMITED

    SGX Quarterly Report 31 March 2019

    Investments in Global Investments Limited (GIL) are not deposits with or other liabilities of Singapore Consortium Investment Management Limited (SICIM), or any of SICIM’s related corporations and are subject to investment risk, including possible loss of income and capital invested. Neither SICIM (manager of GIL), nor SICIM’s related corporations guarantee the performance of GIL or the payment of a particular rate of return on the shares of GIL. This financial report is not an offer or invitation for subscription or purchase or recommendation of GIL shares. It does not take into account the investment objectives, financial situation and particular needs of an investor. Before making an investment in GIL, an investor or prospective investor should consider whether such an investment is appropriate to their particular investment needs, objectives and financial circumstances and consult an investment adviser if necessary. SICIM, as manager of GIL is entitled to fees for so acting. SICIM and its related corporations, together with their respective officers and directors, may hold shares in GIL from time to time. This financial report has been prepared to enable the directors to comply with their obligations under the Listing Manual of the Singapore Exchange Securities Trading Limited (Listing Manual) and where relevant, to satisfy the requirements of the International Financial Reporting Standards. The responsibility for the preparation of the financial report and any financial information contained in this financial report rests solely with the directors of GIL.

  • UNAUDITED FINANCIAL REPORT For the quarter ended 31 March 2019

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    CONTENT

    CONTENT 2

    PERFORMANCE REVIEW 3

    INVESTMENT PORTFOLIO 4

    BUSINESS REVIEW AND OUTLOOK¹ 5

    CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 8

    STATEMENT OF FINANCIAL POSITION 9

    CONSOLIDATED STATEMENT OF CASH FLOWS 10

    CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY 11

    STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY OF THE COMPANY 12

    ACCOUNTING POLICIES APPLICATION 13

    DIVIDENDS 13

    SHARE CAPITAL 13

    NET ASSET VALUE 14

    EARNINGS PER SHARE 14

    AUDIT OR REVIEW 14

    INTERESTED PERSON TRANSACTION 14

    CONFIRMATION OF THE BOARD PURSUANT TO RULE 705(5) OF THE LISTING MANUAL 15

    CONFIRMATION PURSUANT TO RULE 720(1) OF THE LISTING MANUAL 15

  • UNAUDITED FINANCIAL REPORT For the quarter ended 31 March 2019

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    PERFORMANCE REVIEW

    FINANCIAL PERFORMANCE FOR QUARTER ENDED 31 MARCH 2019

    The Company and its subsidiaries (the Group) reported a profit after tax of S$12.9 million for the current quarter as compared to a net loss after tax of S$2.2 million in the same quarter last year.

    INCOME

    Income for 1Q 2019 was S$14.0 million as compared to a loss of S$1.1 million in 1Q 2018. The higher income was mainly due to net gain on financial assets at fair value through profit or loss (FVTPL) of S$9.9 million in 1Q 2019, versus a loss of S$4.9 million in the comparative period. The net gain on financial assets at FVTPL during the quarter was mainly contributed by listed equities and bank contingent convertibles. EXPENSES

    Expenses recorded in both 1Q 2018 and 2019 remained relatively unchanged at S$1.0 million.

    OTHER COMPREHENSIVE INCOME

    There was no other comprehensive income for the quarter as compared to a translation loss of S$1.1 million in 1Q 2018. As a result, total comprehensive income for the Group was S$12.9 million versus a loss of S$3.3 million recorded in the same quarter last year.

    STATEMENT OF FINANCIAL POSITION FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

    The financial assets at FVTPL as at 31 March 2019 was S$285.7 million and comprised the entire portfolio of investments held by the Group. This was S$1.8 million higher than the carrying value of the portfolio of investments of S$283.8 million as at 31 December 2018. The increase was mainly due to an overall increase in fair value of investments and offset by a net divestment of investments during the quarter.

    CASH AND CASH EQUIVALENTS

    Cash and cash equivalents increased to S$45.5 million as at 31 March 2019 compared to S$35.4 million as at 31 December 2018. This was mainly due to the net divestment of investments which include bank contingent convertibles, China domestic bonds and listed equities of approximately S$10.0 million during the quarter.

    NET ASSET VALUE PER SHARE The net asset value per share of the Group as at 31 March 2019 increased to 19.53 Singapore cents from 18.69 Singapore cents as at 31 December 2018 due to profit after tax recorded for the quarter.

  • UNAUDITED FINANCIAL REPORT For the quarter ended 31 March 2019

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    INVESTMENT PORTFOLIO

    GIL was listed on the Main Board of the Singapore Exchange Securities Trading Limited on 20 December 2006. On 7 January 2019, the company transferred its domicile from Bermuda to Singapore and it is now registered in Singapore. GIL’s investment policy is to make investments in a portfolio of assets in different sectors through different means which includes but not limited to direct asset ownership, swaps, credit default swaps, debts, warrants, options, convertibles, preference shares, equity, guarantees of assets and performance, securities lending and participating loan agreements provided that it will not make any direct investments in real estate and commodities. The Group’s investment portfolio at 31 March 2019 comprised the following assets: LOAN PORTFOLIO AND SECURITISATION ASSETS

    The Group is invested in a portfolio of USD denominated collateralised loan obligation (CLO) notes and a credit-linked note (CLN). The CLO investments are in mezzanine notes which are issued by securitisation vehicles that hold collateral consisting of mainly senior secured corporate debt. The CLN investment references a portfolio of trade finance obligations and corporate loans, with the obligors mainly domiciled in Asia. In addition, the Group is invested in a portfolio of asset backed securities (ABS) comprising Australian residential mortgage backed securities (RMBS), Australian credit card ABS and Chinese auto ABS.

    BONDS

    CHINA DOMESTIC BONDS The Group is invested in a portfolio of China domestic bonds. OTHER BONDS The Group is invested in a portfolio of mainly high yield bonds other than China domestic bonds.

    BANK CONTINGENT CONVERTIBLES

    The Group is invested in a portfolio of bank contingent convertible securities denominated in various currencies.

    LISTED EQUITIES

    GIL is invested in a portfolio of listed equities traded on various exchanges including Australia, Europe, China, Hong Kong, Singapore, South Korea and US.

    Net asset value as at 31 March 2019 and 31 December 2018 is S$332.16 million and S$322.21 million respectively.

  • UNAUDITED FINANCIAL REPORT For the quarter ended 31 March 2019

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    BUSINESS REVIEW AND OUTLOOK¹

    MACROECONOMIC

    The International Monetary Fund (“IMF”) in its latest World Economic Outlook report released in April 2019, has lowered its projection for global economic growth to 3.3% in 2019 and 3.6% in 2020, a downward revision of 0.4% and 0.1% respectively. Global growth is expected to be lower at 3.3% in the first half of 2019 before stabilizing in the second half, due to the ongoing policy stimulus by the Chinese government, recent positive sentiments in global financial markets, and stronger growth momentum in developing economies. In the US, according to the advance estimate by the Bureau of Economic Analysis (“BEA”), Gross Domestic Product (“GDP”) grew by 3.2% quarter-on-quarter (“q-o-q”) in 1Q 2019, compared to 2.2% q-o-q in 4Q 2018. The ISM Manufacturing Purchasing Manager Index (“PMI”) increased to 55.3 in March 2019 as compared to 54.3 in December 2018, while the ISM Non-Manufacturing PMI Index decreased to 56.1 in March 2019 compared to 58.0 in December 2018. Meanwhile, the Consumer Price Index (“CPI”) remained unchanged at 1.9% year-on-year (“y-o-y”) in March 2019 compared to December 2018. The US unemployment rate decreased to 3.8% in March 2019 when compared with 3.9% in December 2018 while the participation rate decreased to 63.0% in March 2019 compared to 63.1% in December 2018. The Federal Open Market Committee (“FOMC”) decided to maintain the target federal fund rate at the March meeting, keeping it unchanged at a range of 2.25%-2.50%. The FOMC’s guidance of a ‘patient’ approach towards future interest rate adjustments was interpreted by market participants as no further rate hikes for 2019. This was likely in response to a labour market that remained strong but slower growth in household spending and business fixed investment in the first quarter. In China, GDP grew at 6.4% y-o-y in 1Q 2019, unchanged from the previous quarter. The Caixin Manufacturing PMI increased to 50.8 in March 2019 when compared to 49.7 in December 2018, while the Caixin Services PMI increased to 54.4 from 53.9. Retail sales grew by 8.7% y-o-y in March 2019 compared to 8.2% y-o-y in December 2018. Exports expanded 14.2% y-o-y in March 2019, compared to -4.4% y-o-y in December 2018, while imports remained unchanged at -7.6% y-o-y. The CPI increased to 2.3% y-o-y in March 2019 from 1.9% y-o-y in December 2018.